Alipay+’s UPI Linkup Stalled Over Security, Data Concerns: Report

Alipay+’s proposed linkage with UPI for cross-border payments has reportedly been stalled over national security concerns and questions surrounding the storage and use of customer data. 

The proposal, submitted by Alipay+ in January, was aimed at allowing Indian travellers to make UPI payments across its network of more than 150 Mn merchants in China, Hong Kong, and other parts of Asia, according to a Reuters report. 

The second phase would have allowed international visitors to use Alipay+ to make payments in India.

The Centre’s concerns stem from Alipay+’s Chinese links, data-security risks, and the potential misuse of customer data, the report said, citing three people familiar with the discussions.

The Ministry of External Affairs (MEA) cited “political grounds” for putting the proposal on hold, one of the sources said, adding that there is no clear path to resolving the concerns yet.

Law enforcement agencies have separately raised concerns about potential money-laundering risks and data breaches that could expose customers to cyberfraud.

The government is also examining how transaction data would be processed, stored, and managed, as well as the mechanism for resolving payment disputes. While these checks are part of the review process for all bilateral cross-border payment programmes, China-linked entities face significantly greater scrutiny, the report added.

Alipay+’s UPI Proposal

The development comes seven months after reports first emerged about the proposed integration. In February, the Centre and RBI were reportedly in discussions with Ant International to link Alipay+ with UPI as part of efforts to expand India’s instant payment system internationally. 

Alipay+ is operated by Ant International, a Singapore-headquartered digital payments and fintech company that was spun out of China’s Ant Group as an independent entity in 2024. 

The platform operates as a global wallet gateway, allowing users of participating mobile wallets and banking apps to make payments at overseas merchants. It claims to connect more than 1.8 Bn user accounts across over 40 payment partners with more than 150 Mn merchants globally. 

The scrutiny comes even as India and China seek to stabilise bilateral relations. Chinese President Xi Jinping is expected to visit New Delhi later this month to attend the BRICS summit.

UPI’s Overseas Expansion

The development also comes as UPI seeks to widen its international network across markets such as Malaysia, the Philippines, South Korea, Singapore, and France. 

UPI has already established linkages with payment systems and companies in several overseas markets. In 2023, UPI was linked with Singapore’s PayNow to facilitate cross-border fund transfers between the two countries. 

Last year, NPCI partnered with Singapore-based payments infrastructure company HitPay to enable Indian travellers to make QR code-based UPI payments at participating merchants in the country. 

More recently, NPCI’s international arm, NIPL, partnered with Uzbekistan’s HUMO to allow Indian travellers to make UPI payments by scanning UZQR codes.

The international expansion comes as UPI continues to scale domestically. Transactions on the platform touched a record 24.51 Bn in August, up nearly 4% MoM, while their cumulative value stood at ₹29.82 Lakh Cr.

The growth has also renewed discussions around UPI monetisation and interoperability, including the potential imposition of MDR on select transactions and the portability of UPI AutoPay mandates.

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